Key Moments:
- Kenanga Investment Bank Bhd advised minority shareholders to reject Genting Bhd’s MYR2.35 per-share offer, labeling it “not fair and not reasonable”.
- Genting Bhd increased its stake in Genting Malaysia to 57.0 percent, making the offer mandatory under Bursa Malaysia’s regulations.
- The takeover bid is closely linked to Genting Malaysia’s pursuit of a full-scale commercial casino license in downstate New York.
Adviser’s Stand on the Buyout Proposal
Kenanga Investment Bank Bhd, acting as an independent adviser, has urged shareholders to reject Genting Bhd’s current MYR2.35 (US$0.57) per-share offer for Genting Malaysia Bhd. The bank’s latest evaluation points out that the bid represents a discount of 32.47 percent to 37.67 percent compared to Genting Malaysia’s estimated share value range of MYR3.48 to MYR3.77 based on sum-of-parts analysis.
Furthermore, the adviser highlighted that the offer sits at a 3.69 percent to 19.52 percent discount to Genting Malaysia’s highest share prices over the past one and two years. Kenanga referenced the average monthly trading volume of 219.21 million shares, equivalent to 8.08 percent of free float in the last two years, suggesting that shareholders might achieve higher returns through open-market transactions if liquidity remains favorable.
Kenanga cautioned that if Genting Bhd fails to surpass the 90 percent ownership required for delisting, minority shareholders could face uncertainty regarding the company’s future, particularly in light of potential U.S. expansion and restructuring plans for Empire Resorts. The Genting Malaysia board members without an interest in the offer supported Kenanga’s assessment, describing the bid as “not fair” and “not reasonable”.
Escalation of Parent’s Ownership Level and Status of the Offer
Genting Bhd initiated the buyout as a voluntary and conditional offer in mid-October, owning 49.36 percent of Genting Malaysia at that time. Subsequent market purchases pushed its stake above 50 percent, thereby making the offer unconditional. By 5 pm on Thursday, the parent company’s ownership had reached 57.0 percent, prompting a mandatory takeover situation under Bursa Malaysia regulations after acquiring an additional 2.02 percent through market acquisitions. The bid’s highest price during these purchases did not surpass the MYR2.35 offer.
Cumulatively, Genting Bhd has accumulated about 5.66 percent of Genting Malaysia shares through offer acceptances, totaling slightly over 320.8 million units, and nearly 114.5 million shares purchased on the open market since the bid became unconditional.
The acceptance deadline has now been moved from 24 November to 5 pm on 1 December.
| Genting Bhd’s Shareholding Evolution | Percentage |
|---|---|
| Initial stake in mid-October | 49.36% |
| Post-open market purchases | Above 50% |
| As of Thursday, 5 pm | 57.0% |
| Through shareholder acceptances | 5.66% |
| Affiliates’ combined holding (early November) | 52.13% |
Delisting Objectives and Shareholding Requirements
The main aim of the offer is to achieve the delisting of Genting Malaysia. This objective would require Genting Bhd to raise its direct and affiliated holdings to either 75 percent for statutory control or 94.94 percent for a compulsory acquisition. As of early November, Genting Bhd and its affiliates controlled 52.13 percent, necessitating an increase of 22.87 percent to fall below the required public shareholding spread and a total additional 37.87 percent to fulfill compulsory acquisition standards.
Market analysts have suggested that full ownership could simplify Genting Bhd’s overall management, offer greater financial flexibility, and facilitate capital allocation across its worldwide casino properties. During the offer period, Genting Bhd issued MYR900 million (US$216 million) in medium-term notes to strengthen its financial position.
New York Casino License Push: Motivation for the Bid
A significant driver behind the acquisition is Genting Malaysia’s pursuit of a highly sought-after full casino license in downstate New York, with an award decision anticipated by the end of 2025. Genting Malaysia runs Resorts World New York City (RWNYC) in Queens and has outlined plans for extensive capital investment if granted a full gaming license, which would enable table games and is projected to increase long-term revenue. The broader group also includes Resorts World Catskills through Empire Resorts.
Maybank Investment Bank previously commented that RWNYC is “virtually assured” of obtaining a license, citing its operational scale and fiscal importance. According to Maybank, RWNYC could capture 42 percent of the projected US$6.5 billion downstate market by 2031, translating to US$2.7 billion in gross gaming revenue. An upgrade to full casino status could elevate Genting Malaysia’s net profit to MYR1.93 billion (US$455 million) by 2030. Maybank has likewise advised shareholders to reject the MYR2.35 offer, stating it does not fully capture the company’s growth outlook.
Strategic Importance of Genting Malaysia’s Global Portfolio
Genting Malaysia’s operations span several countries and contribute a large proportion of the group’s revenue with properties in Malaysia, the United Kingdom, Egypt, the United States, and the Bahamas. Its flagship, Resorts World Genting, remains Malaysia’s only licensed casino. This international presence makes Genting Malaysia a vital piece of the broader Genting Bhd structure.
- Author
Daniel Williams
